DTN Midday Grain Comments

All Grains Down at Midday

David M Fiala
By  David Fiala , DTN Contributing Analyst
(DTN photo by Nick Scalise)

General Comments

The U.S. stock markets are mixed with the Dow futures up 15 points. The interest rate products are higher. The dollar index is 14 points lower. Energies are higher with crude up 1.00. Livestock trade has cattle lower, and hogs higher. Precious metals are lower with gold down $5.

CORN

Corn trade is 3 to 4 cents lower at midday with long profit taking occurring. Ethanol futures are lower at midday despite higher crude and unleaded trade but the fact ethanol futures are a premium to unleaded warrants lower discretionary blending. The monthly WASDE report coming up tomorrow morning will be watched closely and should trigger some position squaring ahead of it. The average trade guess is for a 13.505 billion bushel crop versus 13.585 billion on the September report, the range of estimates is 13.28 to 13.799. The carryover is expected to slip to the 1.535 billion bushel area versus the 1.592 September number. The weekly export sales were mediocre at 519,700 metric tons. On the nearby December chart nearby support is the 100-day moving average at $3.88, then the 20-day at $3.87. Resistance is at the 200-day at $3.98.

SOYBEANS

Soybean trade is 7 to 11 cents lower with trade giving back the light midweek gains. Meal is $2.50 to $3.50 lower, and oil is 15 to 25 points lower. Harvest progress should continue rapidly with warm temperatures and fairly open weather. The average trade guess is looking for a 47.2 yield versus 47.1 on the report last month, but lower acreage so the production estimate is at 3.91 billion versus 3.935 on the September report. The carryover estimate is at 415 million bushels versus 450 on the September report. The weekly export sales were good at 1.28 million metric tons for this year, 995,600 for next year, 275,500 of meal, and 15,000 of oil. USDA announced 20,000 metric tons of soy oil sold to unknown as well. On the November chart the contract low at $8.53 1/4 is long-term support with the 20-day moving average at $8.80 nearby support, which we have held at midday. Upside resistance is at the $8.99 50-day then the $9.02 high seen last week.

WHEAT

Wheat trade is 3 to 6 cents lower across the three contracts at midday with the weaker row crop trade adding pressure. International weather is a growing question mark with Australia mostly in focus with heat in the near term, but ample world supplies will limit concerns. Focus on corn and soybean harvest activity and the low wheat prices may limit winter wheat plantings this month, and wheat likely needs to buy additional acres. The WASDE report is expected to show some reduction in wheat carryout after the stocks and production reports were below expectations. The average carryover estimate is at 820 million bushels versus 875 million on the September report. The weekly export sales were soft at 288,200 metric tons. On the Kansas City December chart support is at the 10-day at $5.03 and 20-day moving average at $4.96 with resistance at the $5.20 7-week high reached this week then the $5.33 100-day moving average.

David Fiala is a DTN contributing analyst and the President of FuturesOne and a registered trading adviser.
David Fiala can be reached at dfiala@futuresone.com
Follow David Fiala on Twitter @davidfiala

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David Fiala